Luxury electric car company Tesla is hoping to re-charge its bank account with a $100 million initial public offering. The company filed documents with the Securities and Exchange Commission on January 29, putting itself in prime position to become the country's first mainstream electric car company.
The six-year-old startup is run by Elon Musk, the South African-born PayPal co-founder who was Inc.'s Entrepreneur of the Year in 2007. The stock sale marks the first IPO from a U.S. automobile maker since Henry Ford's eponymous company made went public in 1956. Tesla's long-anticipated announcement is also the latest in a string of clean-tech start-ups going public. Codexis (No. 924 on Inc.'s 2009 5000), a Redwood City company that crafts designer enzymes for biofuel production, filed its IPO documents in late December. January saw filings from China-based JinkoSolar Holding Co. Ltd (which plans to list on the NYSE), and Fremont-based Solyndra, a maker of skinny tube-shaped solar panels for commercial rooftops.
Tesla's IPO stands out, however, as a potential bellwether that could juice the sluggish appetite for public offerings.
"People are going to be watching this one move through the pipeline," Matt Therian, an analyst with Renaissance Capital, a Connecticut-based IPO research firm, told Reuters. "It's probably a good sign for the IPO market."
Tesla's two-door $109,000 Roadster is the only model the company has on the market, and buyers include George Clooney, Matt Damon, Leonardo DiCaprio and David Letterman. Warren Brown, the Washington Post's automotive critic, called the Roadster "a head-turner, jaw-dropper. It is sexy as all get-out." He declared: "If this is the future of the automobile, I want it."
Tesla plans to answer criticism that its product is a trophy toy for the wealthy by selling a four-door family sedan, the Model S, in 2012. The Model S will sell for $49,900--the price made possible through a federal-tax credit.
The company's 173-page S-1 form filed revealed a few surprises, including that the company will pull the plug on the current generation Tesla Roadster "after 2011 due to planned tooling changes at a supplier." A new model will be available in 2013. The form also disclosed that Musk takes a yearly salary of just $1. (Musk is unlikely to be struggling: He took $175,000 in reimbursements for using his private jet, and received $23.89 million in option awards. And then there's his previous successes: eBay bought PayPal in 2002 for $1.5 billion, and Compaq paid $307 million for Musk's media company Zip2 in March 1999, when he was just 27.)
Tesla – the name pays homage to inventor Nikola Tesla, who made key discoveries in the development of commercial electricity – said in the filings that it had sold 937 Roadsters as of December in 18 countries. Through September 2009, it generated $108.2 million in revenue and accumulated debt of $236.4 million. Its net loss for 2009 was $31.5 million, a reduction from 2008.
The company has cash of $106 million, 514 employees – and a $465 million loan with loan guarantees it received from the Department of Energy on Jan. 21. The money from the IPO will fund a production center for the Model S sedan – which so far has 2,000 orders – and other capital expenditures.